Precautions about Signal Providers
Does it seem lucrative to you earning money on the basis of operations performed by signal providers? Indeed, it seems much easier paying such services for their expertise rather than learning binary charting. Still, do not hurry to entrust your resources to signal providers. There are few aspects you have to acquaint yourself with before engaging in cooperation with such platforms. The factors, which we list below, may convince you that giving your money to signal providers can lead you to losing your funds.
The Absence of Trial
If a signal provider is reliable and can really make profitable deals for you, then it must also offer a free demo version to test it. There is no sense in denying providing an access to demo version if the platform is really effective. Thus, if it brings real benefits, the users will employ it even after closing a trial account. Accordingly, if there is no such option as a service providing free binary options signals, it would be better for you to skip its services.
You must be very careful with trading on the basis of bots, robots or EA signals. Due to the machinery processes the latter sustain, the results of trading may be unexpected sometimes. The absolute advantage of such automated indicators is that they make trading unemotional. Still, bots employ the data that is back tested, which is why any further bots’ optimization relies on the same data sets. It can be a serious problem, due to the fact that positive trading results can not be grounded on long-term/live marketing. Thus, if you find a provider that claims bots being the guarantee of success and working out in any trading conditions, you must note that you are most likely tricked.
One also may find profitable bots on the market. Approximately the fourth part of all NYSE trading acts may be defined as program operations. The employment of this technology may be extremely profitable for separate firms. You must be able to make a difference between the latter and robots. While the so-called black boxes always stay under a constant supervision and are monitored by the high-valued computer programs, robots do not receive that much attention.
Signals without Traders
According to the regulations on signal providers, there is a different number of trades that may be sent daily (3, 5, 8, 30...). Still, it does not mean that all of these signals can be converted in tradable acts. Quite often, certain signals presuppose the realization of specific conditions, which do not always match marketing reality. That is why, your primary task is counting the number of realized trades rather than forwarded signals.
Employing statistics is a good strategy of presenting any information in a positive light. For instance, sometimes, you can come across the scripts that suggest 90% of profitable trades. Still, it always remains unclear what is the time period, to which the data relates. In this case, you can not be sure that the offer is actual, at the moment, which is why you are supposed to clarify this issue. If a signal provider still leaves you in the dark, you should better skip this platform at all.
The Lack of History Track
The fact that many signal providers tend to hide the information about the time frames, to which statistics relates, reveals that they may lack experience and do not want to disclose that. Although binary options have functioned in market for several years now, there are very few signal platforms, which have stayed in play for such a long time. The history track of a signal provider is a determining factor, which may show how successful the platform is. Thus, if the service brings profitability but functions only several months, one can still view its success as a matter of luck rather than expertise. Accordingly, we recommend cooperating only with the services, which have a long history of functioning and, consequently, have been tested by diverse marketing conditions.
No Agreement on the Invested Sum
It is a critical warning sign if a signal provider dictates the sums that have to be invested by traders. You may come across the platforms that demand spending 1, 3 or 5 units on each trading act. In this case, 1 unit will be equal $10, 3 units - $30, etc. Since the provider can not know what your current balance is, it is impossible for it to predict the invested sum instead of you. If the platform still prescribes this rule, it shows that it runs inefficient risk management techniques. Do not forget that the money you trade with belongs to you, which is why only you can estimate how much can be risked.
The Aspect of Timing
One more important characteristic feature of effective signal providers is its timely release. Thus, in order to process a signal efficiently and provide a respective reaction to it, it must be sent in the appropriate moment, together with the clarification about its application. In case you notice that the provider does not manage releasing signals in a timely way, you should better avoid cooperating with it since it may negatively affect the quality of your trading. In order to estimate the timing of signal providing, you should test the platform on the basis of a trial account before opening a real one.
Be Your Own Boss
The strong argument in support of taking control of your trades by yourself is that signal providers are not affected by your losses. Indeed, there is a range of platforms, which produce random signals that are not adapted to marketing conditions, which leaves traders in “out of money” position. It happens since signal providers do not carry any responsibility for your trades and are not motivated to enhance your balance. But you are.
Those is why, instead of relying on external services and paying for their expertise, try to develop your own trading skills. In this way, you will not be dependent on anyone except for your own skills while making trades.
The best decision is learning how to be a successful binary trader without the relation to any external providers. Although you need to spend much more time on educating yourself than on entrusting your resources to automated systems, you will be in a profitable position at the end. If you employ signal providers, do not hesitate testing their reliability by asking specific questions about their expertise. In case the services do not answer your requests and do not clarify specific aspects or can not offer demo versions, do not engage in cooperation with them.